At the beginning of 2016, the world economy is continuing along a path of moderate growth. The solid growth of the advanced economies continues to be one of the key drivers of the global economy. But for the first time in five years, the emerging markets might also be able to support the upward trend with their aggregate growth rate.

Current leading indicators suggest that the US economy will continue the upswing that has now lasted for six years. This outlook is based on the continuation of solid domestic demand and above all the robust growth of private consumption, and should not be altered by the fact that the US Federal Reserve has emerged from the phase of zero interest rates. The majority of analysts therefore expect growth in gross domestic product (GDP) of 2 to 2.5 %.

The outlook for the Japanese economy is significantly less positive. In order to achieve the projected GDP growth of just over 1 %, it is above all necessary for private consumption to increase following its decrease in 2015.

The economy of the European Monetary Union (EMU) should continue its recovery in 2016. The main drivers are likely to be the latest - once again more expansive - monetary policy measures of the European Central Bank, the comparatively weak euro, rising real incomes and ongoing support from low raw-material prices. To what extent the dominant political events such as the refugee crisis and the ongoing uncertainty surrounding the Ukraine conflict will affect economic prospects in Europe cannot yet be assessed at the beginning of 2016. It is currently assumed that the EMU could achieve economic growth in the magnitude of 1.5 to 2 %. Growth expectations for the German economy are within a similar corridor. With growth of more than 2 %, the British economy should expand again significantly, despite the debate about its continued membership of the European Union.

The development of China continues to be of key importance for the world economy. Despite current uncertainty with regard to the Chinese stock market and the development of the currency exchange rate, most analysts assume that a sudden slump in growth dynamism (“hard landing”) can be avoided. However, the ongoing economic restructuring – away from high investment and towards more consumption – will entail rather lower growth rates of about 6.5 %. Due to the renewed fall in raw-material prices at the beginning of 2016, the economic situation of all emerging markets that rely on exports of raw materials remains critical. Recessive tendencies are still very pronounced in those countries. This applies in particular to Brazil, and to a lesser extent also to Russia. But as many other emerging markets remain significantly below their long-term expansion potential, the growth of these economies will remain limited and will be only slightly stronger than in 2015.

In total, global economic output in 2016 is unlikely to exceed the rather below-average growth corridor of 2.5 to 3 %. With regard to the currencies important for our business, we continue to anticipate significant exchange-rate fluctuations in 2016.

In order to counteract the risks arising for our business as a result of still very volatile exchange rates, we conduct hedging transactions as far as this makes sense for the various currencies. For the year 2016, we have hedged approximately 80 % of the exchange-rate risks as of mid-February.